Energy 2027

Technological improvements, political pressure, and global GDP growth are changing the world’s energy consumption. In this blog post, I discuss the energy landscape over the next decade in light of recent breakthroughs in hydraulic fracturing, China moving away from coal, and the renewable energy boom. I am basing my post on the analysis in the US Energy Information Administration’s (EIA) “International Energy Outlook 2016”, and the “BP Energy Outlook 2017 edition”.

Liquid fuels.

Petroleum and other liquid based fuels will continue as the world’s leading fuels over the next decade. We have not yet hit peak oil consumption, and we won’t do so anytime soon. Most of the growth in liquid fuel consumption is in the transportation and industrial sectors.

The global fleet of cars is expected to double in the next twenty years, increasing car ownership rates in emerging markets will drive this growth. Global fuel demand for use in vehicles continues to grow and will do so over the next decade, but after 2027 the coming transport revolution will begin to change this. Going forward automated cars will lead to enhanced fuel efficiency, electric vehicles are expected to claim a significant share of the new car market, and car sharing/ride pooling will become more normalized, all likely to have some impact on petroleum consumption.

Coal

We haven’t yet hit peak coal consumption yet, but by 2027 we might. Coal is going to experience slower growth than any other fossil fuel. China is moving away from coal towards cleaner, lower-carbon fuels, as its economy shifts towards a more sustainable pattern of growth. China’s coal consumption is projected to broadly plateau over the next decade, in sharp contrast to the rapid, industrialization-fueled growth of much of the past 20 years.

Natural gas

Since the “US Shale Boom” (circa 2008) natural gas has experienced phenomenal growth and will continue to grow even faster with liquefied natural gas (LNG) in particular is facilitating this expansion. In Europe, natural gas production is slowing down fast, but consumption is still expected to rise over the next decade. Europe’s dependence on Russia to meet its increasing natural gas demands will ease as more LNG production plants become operational in the US. Australian and Chinese natural gas production are expected to double over the next decade, natural gas is going to take off completely.

Renewables

Renewable energy is projected to be the fastest-growing fuel source (7.6% p.a.), more than quadrupling over the next twenty years. This growth is driven by increasing competitiveness and is being led by solar and wind. BP’s analysis (see the figure below), suggests that onshore wind power will remain more competitive than solar energy in both the US and China power sectors, with gas providing the primary source of competition in the US and coal in China.

Nuclear

In Europe, aging nuclear plants are being decommissioned and will continue to do so going forward with little reinvestment in new plants. In the UK, for example, there are currently eight nuclear power stations in operation, and there will only be four remaining in 2027, all of which are set to be retired by 2035. But on the global scale, we should still see some growth in the nuclear sector driven by rapid expansion in China as they move away from coal.

Gary O’Keeffe is a PhD student in MACSI, his research investigates modelling the flow of heat in nanofluid-based direct absorption solar collectors/nanofluid based parabolic trough solar collectors, and solving models analytically rather than using computational fluid dynamics.

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